FORT WORTH, Texas, May 9, 2019 /PRNewswire/ -- Basic Energy
Services, Inc. (NYSE: BAS) ("Basic" or the "Company") today
announced its financial and operating results for the first quarter
ended March 31, 2019.
FIRST QUARTER 2019 HIGHLIGHTS
- Reported revenue of $197.2
million, net loss of $27.5
million and loss per share of $1.02;
- Generated Adjusted EBITDA1 of $14.4 million and cash from operations of
$1.8 million;
- Total liquidity was $130.0
million at March 31, 2019,
comprised of cash and cash equivalents of $63.8 million and undrawn availability under its
New ABL Facility (defined below) of $66.2
million;
- Well Servicing represented 31% of revenues, Water Logistics was
28% of revenues, and Completion & Remedial Services was 39% of
revenues; and
- Well Servicing and Water Logistics continued to provide
stability and growth in the quarter, with combined direct margins
of $31.6 million, up $3.9 million sequentially on a $1.8 million increase in revenue.
First quarter 2019 revenue decreased sequentially to
$197.2 million from $230.4 million in the fourth quarter of 2018,
primarily due to declines in pressure pumping operations,
particularly frac. In the first quarter of 2018, Basic generated
$234.7 million in revenue.
For the first quarter of 2019, Basic reported a net loss of
$27.5 million, or a loss of
$1.02 per basic and diluted
share. This result is compared to a net loss of $46.7 million, or a loss of $1.76 per basic and diluted share for the fourth
quarter of 2018, and a net loss of $30.5
million, or a loss of $1.16
per basic and diluted share in the first quarter of 2018.
Adjusted EBITDA1 was $14.4
million or 7% of revenues for the first quarter of 2019,
compared to $21.8 million, or
10% of revenues in the fourth quarter of 2018. In the first quarter
of 2018, Basic generated Adjusted EBITDA1 of
$23.3 million, or 10% of
revenues.
As of March 31, 2019, the Company
had total liquidity of $130.0
million, which included cash and cash equivalents of
$63.8 million and borrowing capacity
under its senior secured revolving credit facility (the "New ABL
Facility") of $66.2 million.
The Company was undrawn on the New ABL Facility at the end of the
first quarter of 2019.
Roe Patterson, President and CEO, stated, "First quarter results
were in line with our initial expectations, and though we
anticipated lower revenues from normal weather interruptions and
less frac and completion work, we were pleased that our core focus
on production-oriented services provided first quarter revenue
stability and segment profit improvements in both Water Logistics
and Well Servicing. Our production service businesses
outperformed expectations in the first quarter, with margin
improvement due in part to the positive impact of our recent
strategic realignment initiative, which allowed our total Company's
direct margin percentage to expand during the period despite the
negative impact of the payroll tax reset in the first
quarter. As we anticipated for first quarter,
completion activity slowed.
"We remain bullish on our business for 2019 and are focused on
maintaining capital flexibility and allocation discipline;
therefore, we are moderating our plans for capital expenditures
this year from $94 million to
$69 million. Under the new
capital expenditure plan, we anticipate that growth capital will be
spent judiciously on long-lived water assets and equipment to
support 24-hour rig packages with the expected highest return to
Basic. Due to a combination of capital efficiency, timing and
expected performance, we do not expect a degradation in 2019
EBITDA, while anticipating a significantly improved free cash flow
generation for the year.
"Based on our new capital plan, we expect to generate EBITDA of
$70 to $75
million for full year 2019, or adjusted EBITDA of
$84 to $89
million which excludes $14
million of non-cash stock compensation expense. Under
this scenario, we forecast a 2019 year-end cash balance of
$60 to $65
million and total liquidity of $135 to $140
million, with our New ABL Facility remaining undrawn. We
believe this guidance remains conservative in nature especially
with respect to frac activity with significant upside potential to
these projections if completion activity accelerates over the
course of the year," concluded Patterson.
1Adjusted
EBITDA and EBITDA are not measures determined in accordance with
United States generally accepted accounting principles
("GAAP"). See "Supplemental Non-GAAP Financial Measures"
below for further explanation and reconciliations to the most
directly comparable financial measures calculated and presented in
accordance with GAAP.
|
First Quarter 2019 Business Segment Results
Well Servicing
Well Servicing revenues increased 3% sequentially to
$60.5 million during the first
quarter of 2019 compared to $58.8
million in the prior quarter due to improved utilization
with pricing essentially flat. Well Servicing revenues were
$57.0 million in the first quarter of
2018. Weather and holidays negatively impacted Well Servicing
revenues by approximately $3.4 million in the first quarter of
2019.
The Well Servicing rig count was 310 at March 31, 2019,
consistent with 310 at December 31, 2018. Rig hours were
165,000 in the first quarter of 2019, up 3% compared to 159,600
hours in the fourth quarter of 2018 and down 2% from 168,500 hours
in the comparable quarter of last year. Rig utilization was
74% in the first quarter of 2019, up from 72% in the fourth quarter
of 2018 and down from 76% in the first quarter of 2018 based on our
current fleet of 310 service rigs. The Company averaged a
total of 21 24-hour service rig rental equipment packages working
for the first quarter of 2019. At the end of April 2019, the Company averaged 22 active
equipment packages. During the first quarter of 2018, the
Company averaged 21 active equipment packages. Revenue for
the rental equipment portion of a 24-hour package is recorded in
our Completion & Remedial Services segment.
Revenue per well servicing rig hour, was $367 in the first quarter of 2019 flat compared
to $368 in the previous quarter and
up 9% from $338 reported in the first
quarter of 2018. The sequential increase in the first quarter
compared to the first quarter of 2018 was mainly due to increased
productivity and a lower cost structure.
Segment profit in the first quarter of 2019 increased 18% to
$13.3 million, compared to
$11.3 million in the prior quarter
and increased 28% from $10.4 million
during the same period in 2018. Segment profit margin was 22%
in the first quarter of 2019, up from the 19% reported in the prior
quarter, as margin improvement from our recent strategic
realignment initiative more than offset the negative impact of the
payroll tax reset during the quarter. In the first quarter of 2018,
segment profit margin was 18% of segment revenue.
Water Logistics
Water Logistics revenue in the first quarter of 2019 was
$55.6 million, flat compared to
$55.6 million in the prior
quarter. During the first quarter of 2018, this segment
generated $56.5 million in revenue.
Weather and holidays negatively impacted Water Logistics revenues
by $1.4 million in the first quarter
of 2019.
The weighted average number of fluid services trucks decreased
2% to 818 during the first quarter of 2019, compared to 837 during
the fourth quarter of 2018 and decreased 15% from 960 during the
first quarter of 2018. The decrease in the number of trucks
has been driven by the structural change taking place in the
industry where increasing volumes of fluids are moving through
pipelines, a significantly lower-cost alternative for our
customers. Truck hours of 424,100 during the first quarter of
2019 represented a decrease of 3% from the 438,500 generated in the
fourth quarter of 2018 and a decrease of 12% compared to 479,600 in
the same period in 2018.
Total pipeline water volumes disposed at Basic-owned saltwater
disposal wells ("Basic SWDs") decreased 6% to 3.0 million barrels
during the first quarter of 2019 compared to 3.2 million barrels
during the fourth quarter of 2018. Pipeline disposal volumes
to Basic SWDs in the Permian Basin continue to maintain at 58% of
total water disposal volumes in the Permian Basin, flat from 58%
for the fourth quarter of 2018 and up from 33% in the first quarter
of 2018.
Segment profit in the first quarter of 2019 increased by 12% to
$18.3 million, compared to a profit
of $16.3 million in the fourth
quarter of 2018. Segment profit margin increased sequentially by
approximately 350 basis points to 33% due to increases in higher
margin pipeline disposal. Segment profit in the same period
in 2018 was $15.6 million, or
28% of segment revenue.
Completion & Remedial Services
Completion & Remedial Services revenue decreased 29.5% to
$76.8 million in the first
quarter of 2019 from $108.9 million
in the prior quarter. The decrease in revenue was primarily
due to lower frac activity and pricing as customers curtailed
completion activity due to lower oil prices in late 2018 and in
early first quarter of 2019, as well as weather impact. In the
first quarter of 2018, this segment generated $117.6 million in revenue. Weather
negatively impacted revenues by $1.6 million in the first quarter.
At March 31, 2019, Basic had approximately 489,000
hydraulic horsepower ("HHP"), down slightly from 513,000 in the
previous quarter and down from 523,000 at March 31, 2018. Weighted average HHP for the
first quarter of 2019 decreased to 503,000 from fourth quarter of
2018 levels of 513,000.
Segment profit in the first quarter of 2019 decreased to
$13.4 million compared to
$23.1 million in the prior quarter.
Segment margin for the first quarter of 2019 decreased 380 basis
points to 17% compared to 21% during the previous quarter.
The decrease in segment gross profit was due to the decremental
impact of lower revenue in the frac segment and pricing pressure in
the earlier part of the quarter. During the first quarter of
2018, segment gross profit was $27.9
million, or 24% of segment revenue.
Other Services
During the first quarter of 2019, Basic created an "Other
Services" segment, which combines our previous Contract Drilling
segment with our manufacturing entity. This change is
effective January 1, 2019, and
retrospectively for all periods presented. Other Services
revenue decreased by 40% to $4.3 million during the first quarter of
2019 from $7.1 million in the prior
quarter. During the first quarter of 2018, after giving
effect to Basic's realigned segments, this segment generated
$3.6 million in revenue.
The decline from fourth quarter 2018 to first quarter 2019 is
related to decreased third-party sales in our manufacturing
entity. Basic marketed 11 drilling rigs during the first
quarter of 2019, and the first and fourth quarter of 2018.
Revenue per drilling day in the first quarter of 2019 was up 10% to
$24,200 compared to $22,100 in the previous quarter and up 40% from
$17,300 in the first quarter of 2018,
due to higher rates.
Rig operating days during the first quarter of 2019 decreased by
38% to 115 compared to 184 in the prior quarter, resulting in rig
utilization of 12% during the first quarter of 2019 compared to 18%
during the prior quarter, due to decreased activity. In the
comparable period in 2018, rig operating days were 175, resulting
in a utilization rate of 18%.
Other Services segment profit in the first quarter of 2019 was
$338,000 compared to $808,000 in the prior quarter and a segment loss
of $615,000 in the first quarter of
2018. Segment margin for the first quarter of 2019 was 8% of
segment revenues compared to 11% in the prior quarter. Last
year in the comparable period, segment loss margin was 17%.
The margin decline is mainly due to decreased revenues in the
manufacturing line of business within the segment. Contract
drilling stand-alone margins were 22% in the first quarter of 2019
essentially flat with 23% in the fourth quarter of 2018 and up from
16% in the first quarter of 2018.
General & Administrative Expense
Reported general and administrative ("G&A") expense was flat
at $35.5 million for the first
quarter of 2019 compared to $35.5
million in the fourth quarter of 2018 and down from
$41.0 million in the first
quarter of 2018. Non-cash stock compensation, included in
G&A, was $3.3 million for the
first quarter of 2019, compared to $5.0
million in the fourth quarter of 2018. First quarter
2018 non-cash stock compensation, included in G&A, was
$6.8 million.
Interest Expense
Net interest expense for the first quarter of 2019 was
$10.5 million, which included
interest on Basic's Senior Secured Notes, the New ABL Facility,
capital leases and other financings. Net interest expense in
the fourth quarter of 2018 was $10.7
million, and $11.3 million in
the first quarter of 2018.
Income Taxes
Tax benefit for the first quarter of 2019 was $1.9 million. The effective tax benefit
rate was 6.3% in the first quarter of 2019 compared to a tax
expense rate of 0.2% in the prior quarter. The tax benefit of
$0.1 million in the first
quarter of 2018 translated into an effective tax benefit rate of
0.2%.
During the first quarter of 2019, Basic filed an amended 2007
federal tax return under Sections 172(b)(1)(C) and 172(f) of the
Internal Revenue Code of 1986, as amended, which allowed the
Company to carryback workers' compensation expenses in years we had
Net Operating Losses ("NOL") for up to 10 years. We carried
back approximately $5.3 million of expense to 2007, which allowed
Basic to claim a refund of $1.9 million of 2007 taxes. The
net effect of this transaction was a tax benefit and a reduction of
our NOL of $1.9 million in the quarter ended March 31, 2019.
As of March 31, 2019, the Company
had approximately $809.5 million of
net operating loss carryforwards for federal income tax
purposes. The Company provides a valuation allowance when it
is more likely than not that some portion of the deferred tax
assets will not be realized. As of March 31, 2019, a valuation allowance of
$177.9 million was recorded against
the Company's net deferred tax assets for all jurisdictions that
are not expected to be realized.
Cash and Total Liquidity
On March 31, 2019, Basic had total liquidity of
$130.0 million, comprised of cash and
cash equivalents of approximately $63.8 million and availability under the New
ABL Facility of $66.2 million. Basic reported cash and
cash equivalents of $90.3 million and
availability under the New ABL facility of $69.6 million at December 31, 2018, and reported cash and cash
equivalents of $30.8 million and
availability under its prior ABL facility of $0.5 million at March
31, 2018. Basic had no borrowings outstanding under
its New ABL Facility as of March 31,
2019.
During the quarter ended March 31,
2019, cash provided by operations was $1.8 million, compared to cash provided by
operations of $4.5 million in the
quarter ended March 31, 2018. We used
$20.5 million to decrease accounts
payable in the first quarter of 2019, compared to $6.0 million used to decrease accounts payable in
the first quarter of 2018. Cash used in investing activities was
$16.2 million in the quarter ended
March 31, 2019, compared to cash used
in investing activities of $15.2
million in the quarter ended March 31,
2018. Cash used in financing activities during the quarter
ended March 31, 2019 was $12.1 million compared to cash provided by
financing activities of $6.0 million
in the quarter ended March 31, 2018.
Payments on capital leases during the first quarter of 2019 were
$11.4 million, compared to payments
on capital leases of $13.7 million in
the comparative quarter of 2018.
Capital Expenditures
Total capital expenditures during the first quarter of 2019 were
approximately $24 million, including
$6 million for capital leases, and a
reduction in accounts payable related to capital expenditures of
approximately $1 million.
Additionally, we booked $2.7 million in proceeds from dispositions
during the quarter, partially offsetting our cash capital
expenditures. We currently anticipate 2019 capital
expenditures of approximately $69 million, including
approximately $28 million of expansion capital, of which
$8 million will be funded by capital leases and other
financings. The focus of our expansion capital will be
strengthening our position in the growing and attractive water
disposal midstream services line of business. Approximately
70% of our 2019 growth capital is expected to be directed to
long-lived water midstream infrastructure projects as these
projects are expected to continue delivering improvements in
disposal water volumes, Basic SWD utilization and high margin
contribution as oil production and residual water disposal demand
in our operating areas continues to increase.
Conference Call
Further details are provided in the presentation for our
quarterly conference call to review the first quarter 2019 results,
available in the investor relations section of our corporate
website. The Company will host a conference call to discuss
its first quarter 2019 results on Friday,
May 10, 2019, at 9:00 a.m. Eastern
Time (8:00 a.m. Central
Time). To access the call, please dial (412) 902-0003
and ask for the "Basic Energy Services" call at least 10 minutes
prior to the start time. The conference call will also be
broadcast live via the Internet and can be accessed through the
investor relations section of the Company's corporate website,
www.basicenergyservices.com.
A telephonic replay of the conference call will be available
until May 17, 2019, and may be
accessed by calling (201) 612-7415 and using pass code
13689470#. A webcast archive will be available at
www.basicenergyservices.com shortly after the call and will be
accessible for approximately 30 days.
About Basic Energy Services
Basic Energy Services provides well site services essential to
maintaining production from the oil and gas wells within its
operating areas. The Company's operations are managed
regionally and are concentrated in major United States onshore oil-producing regions
located in Texas, New Mexico, Oklahoma, Arkansas, Kansas, Louisiana, Wyoming, North
Dakota, California and
Colorado. Our operations are focused in liquids-rich basins
that have historically exhibited strong drilling and production
economics in recent years. Specifically, we have a
significant presence in the Permian Basin, Powder River Basin, and the Bakken, Eagle
Ford, and Denver-Julesburg shales. We provide our
services to a diverse group of over 2,000 oil and gas
companies. Additional information on Basic Energy Services is
available on the Company's website at
www.basicenergyservices.com.
Safe Harbor Statement
This release includes forward-looking statements and
projections, made in reliance on the safe harbor provisions of the
Private Securities Litigation Reform Act of 1995.
Forward-looking statements are not statements of historical fact
and reflect Basic's current views about future events. The
words "believe," "estimate," "expect," "anticipate," "project,"
"intend," "seek," "could," "should," "may," "potential" and similar
expressions are intended to identify forward-looking
statements. However, the absence of these words does not mean
that the statements are not forward-looking. Although Basic
believes the expectations reflected in its forward-looking
statements are reasonable and are based on reasonable assumptions
and estimates, certain risks and uncertainties could cause actual
results to differ materially from the projections, anticipated
results or other expectations expressed in this release and the
presentation. These risks and uncertainties include, without
limitation, our ability to successfully execute, manage and
integrate acquisitions, reductions in our customers' capital
budgets, our own capital budget, limitations on the availability of
capital or higher costs of capital and volatility in commodity
prices for crude oil and natural gas. Additional important
risk factors that could cause actual results to differ materially
from expectations are disclosed in Item 1A of the Company's most
recent Annual Report on Form 10-K and other fillings with the
Securities and Exchange Commission. While Basic makes these
statements and projections in good faith, neither Basic nor its
management can guarantee that the transactions will be consummated
or that anticipated future results will be achieved. Any
forward-looking statement speaks only as of the date on which such
statement is made and Basic assumes no obligation to publicly
update or revise any forward-looking statements made herein or any
other forward-looking statements made by Basic, whether as a result
of new information, future events, or otherwise, except as required
by applicable law.
Contacts:
|
Trey Stolz
|
|
VP Investor
Relations
|
|
Basic Energy
Services, Inc.
|
|
817-334-4100
|
-Tables to Follow-
Basic Energy
Services, Inc.
|
Consolidated
Statements of Operations and Other Financial Data
|
(in thousands,
except per share amounts)
|
|
|
|
|
|
Three months ended
March 31,
|
|
2019
|
|
2018
|
|
(Unaudited)
|
Income Statement
Data:
|
|
|
|
|
|
Revenues:
|
|
|
|
|
|
Completion &
Remedial Services
|
$
|
76,834
|
|
$
|
117,597
|
Water
Logistics
|
|
55,601
|
|
|
56,509
|
Well
Servicing
|
|
60,515
|
|
|
56,951
|
Other
Services
|
|
4,252
|
|
|
3,608
|
Total
revenues
|
|
197,202
|
|
|
234,665
|
Expenses:
|
|
|
|
|
|
Completion &
Remedial Services
|
|
63,433
|
|
|
89,659
|
Water
Logistics
|
|
37,299
|
|
|
40,923
|
Well
Servicing
|
|
47,196
|
|
|
46,511
|
Other
Services
|
|
3,914
|
|
|
4,223
|
General and
administrative(a)
|
|
|
35,522
|
|
|
40,978
|
Depreciation and
amortization
|
|
27,498
|
|
|
30,235
|
(Gain) loss on
disposal of assets
|
|
1,455
|
|
|
1,779
|
Total
expenses
|
|
216,317
|
|
|
254,308
|
Operating
loss
|
|
(19,115)
|
|
|
(19,643)
|
Other income
(expense):
|
|
|
|
|
|
Interest
expense
|
|
(10,756)
|
|
|
(11,283)
|
Interest
income
|
|
245
|
|
|
27
|
Other
income
|
|
299
|
|
|
309
|
Loss before income
taxes
|
|
(29,327)
|
|
|
(30,590)
|
Income tax benefit
(expense)
|
|
1,851
|
|
|
59
|
Net loss
|
$
|
(27,476)
|
|
$
|
(30,531)
|
Loss per share of
common stock:
|
|
|
|
|
|
Basic
share
|
$
|
(1.02)
|
|
$
|
(1.16)
|
Diluted
share
|
$
|
(1.02)
|
|
$
|
(1.16)
|
|
|
|
|
|
|
Other Financial
Data:
|
|
|
|
|
|
EBITDA1
|
|
$
|
8,682
|
|
$
|
10,901
|
Adjusted
EBITDA1
|
|
|
14,361
|
|
|
23,285
|
Capital
expenditures:
|
|
|
|
|
|
Property and
equipment
|
|
18,885
|
|
|
15,412
|
Capital
leases
|
|
6,144
|
|
|
3,321
|
|
|
|
|
|
|
|
As
of
|
|
March
31,
|
|
December
31,
|
|
2019
|
|
2018
|
|
(Unaudited)
|
|
(Audited)
|
Balance Sheet
Data:
|
|
|
|
|
|
Cash and cash
equivalents
|
$
|
63,796
|
|
$
|
90,300
|
Net property and
equipment
|
|
442,092
|
|
|
448,801
|
Total
assets
|
|
743,220
|
|
|
761,777
|
Total long-term
debt
|
|
322,358
|
|
|
322,701
|
Total stockholders'
equity
|
|
194,884
|
|
|
219,428
|
|
1 Adjusted
EBITDA and EBITDA are not measures determined in accordance with
United States generally accepted accounting principles
("GAAP"). See "Supplemental Non-GAAP Financial Measures"
below for further explanation and reconciliations to the most
directly comparable financial measures calculated and presented in
accordance with GAAP.
|
|
(a)
Includes approximately $3,288,000 and $6,789,000 of non-cash
compensation expense for the three months ended March 31, 2019 and
2018, respectively.
|
Basic Energy
Services, Inc.
|
Segment
Data
|
|
|
|
|
Three months ended
March 31,
|
|
2019
|
2018
|
Segment
Data:
|
(Unaudited)
|
Completion &
Remedial Services
|
|
|
Total hydraulic
horsepower (HHP) (000's)
|
489
|
523
|
Total frac HHP
(000's)
|
361
|
413
|
Coiled tubing
units
|
17
|
18
|
Rental and fishing
tool stores
|
15
|
16
|
Segment profits as a
percent of revenue
|
17%
|
24%
|
|
|
|
Water
Logistics
|
|
|
Weighted average
number of fluid service trucks
|
818
|
960
|
Truck hours
(000's)
|
424.1
|
479.6
|
Pipeline volumes
(000's)
|
3,050
|
1,551
|
Segment revenues
(000's)
|
$55,601
|
$56,509
|
Segment profits as a
percent of revenue
|
33%
|
28%
|
|
|
|
Well
Servicing
|
|
|
Weighted average
number of rigs
|
310
|
310
|
Rig hours
(000's)
|
165
|
169
|
Rig utilization
rate
|
74%
|
76%
|
Revenue per rig hour,
excluding manufacturing
|
$367
|
$338
|
Well servicing rig
profit per rig hour
|
$81
|
$62
|
Segment profits as a
percent of revenue
|
22%
|
18%
|
|
|
|
Other
Services
|
|
|
Weighted average
number of rigs
|
11
|
11
|
Rig operating
days
|
115
|
175
|
Drilling utilization
rate
|
12%
|
18%
|
Revenue per day
(000's)
|
$24.2
|
$17.3
|
Segment profits as a
percent of revenue
|
8%
|
(17%)
|
Basic Energy Services, Inc.
Supplemental Non-GAAP Financial Measures
EBITDA and Adjusted EBITDA
This earnings release contains references to the non-GAAP
financial measure of earnings (net income) [before interest, which
includes losses on debt extinguishment, taxes, depreciation and
amortization, or "EBITDA." This earnings release also contains
references to the non-GAAP financial measure of earnings (net
income) before interest, taxes, depreciation and amortization, the
gain or loss on disposal of assets, non-cash stock compensation,
executive bonus payments, strategic consulting and realignment
costs, costs for a withdrawn bond offering and professional fees
for tax consulting, or "Adjusted EBITDA." EBITDA and Adjusted
EBITDA should not be considered in isolation or as a substitute for
operating income, net income or loss, cash flows provided by
operating, investing and financing activities, or other income or
cash flow statement data prepared in accordance with GAAP.
However, the Company believes EBITDA and Adjusted EBITDA are useful
supplemental financial measures used by its management and
directors and by external users of its financial statements, such
as investors, to assess:
- The financial performance of its assets without regard to
financing methods, capital structure or historical cost basis;
- The ability of its assets to generate cash sufficient to pay
interest on its indebtedness; and
- Its operating performance and return on invested capital as
compared to those of other companies in the well servicing
industry, without regard to financing methods and capital
structure.
EBITDA and Adjusted EBITDA each have limitations as an
analytical tool and should not be considered an alternative to net
income, operating income, cash flow from operating activities or
any other measure of financial performance or liquidity presented
in accordance with GAAP. EBITDA and Adjusted EBITDA exclude some,
but not all, items that affect net income and operating income, and
these measures may vary among other companies. Limitations to
using EBITDA as an analytical tool include:
- EBITDA does not reflect its current or future requirements for
capital expenditures or capital commitments;
- EBITDA does not reflect changes in, or cash requirements
necessary, to service interest or principal payments on, its
debt;
- EBITDA does not reflect income taxes;
- Although depreciation and amortization are non-cash charges,
the assets being depreciated and amortized will often have to be
replaced in the future, and EBITDA does not reflect any cash
requirements for such replacements; and
- Other companies in its industry may calculate EBITDA
differently than Basic does, limiting its usefulness as a
comparative measure.
In addition to each of the limitations with respect to EBITDA
noted above, the limitations to using Adjusted EBITDA as an
analytical tool include:
- Adjusted EBITDA does not reflect Basic's gain or loss on
disposal of assets;
- Adjusted EBITDA does not reflect Basic's non-cash stock
compensation;
- Adjusted EBITDA does not reflect Basic's professional fees
related to tax recovery during the three months ended March 31, 2019;
- Adjusted EBITDA does not reflect Basic's costs for a withdrawn
bond offering incurred during the three months ended March 31, 2018;
- Adjusted EBITDA does not reflect Basic's executive bonus
expense attributable to the portion of executive bonuses for 2017
that were approved by the Compensation Committee of the Board of
Directors and paid in 2018;
- Adjusted EBITDA does not reflect Basic's strategic consulting
fees during the three months ended March 31,
2018;
- Other companies in the industry may calculate Adjusted EBITDA
differently than Basic does, limiting its usefulness as a
comparative measure.
Basic Energy
Services, Inc.
|
Supplemental
Non-GAAP Financial Measures (Cont'd.)
|
|
|
|
|
|
The following table
presents a reconciliation of net loss to EBITDA (unaudited, in
thousands):
|
|
|
|
|
|
|
Three Months Ended
March 31,
|
|
2019
|
2018
|
Reconciliation of Net
Loss to EBITDA:
|
|
|
|
|
Net loss
|
$
|
(27,476)
|
$
|
(30,531)
|
Income tax
benefit
|
|
(1,851)
|
|
(59)
|
Net
interest expense
|
|
10,511
|
|
11,256
|
Depreciation and amortization
|
|
27,498
|
|
30,235
|
EBITDA
|
$
|
8,682
|
$
|
10,901
|
|
|
|
|
|
|
|
|
|
|
The following table
presents a reconciliation of net loss to Adjusted EBITDA
(unaudited, in thousands):
|
|
|
|
|
|
|
Three Months Ended
March 31,
|
|
2019
|
2018
|
Reconciliation of
Net Loss to Adjusted EBITDA:
|
|
|
|
|
Net loss
|
$
|
(27,476)
|
$
|
(30,531)
|
Income
tax benefit
|
|
(1,851)
|
|
(59)
|
Net
interest expense
|
|
10,511
|
|
11,256
|
Depreciation and amortization
|
|
27,498
|
|
30,235
|
(Gain)
loss on disposal of assets
|
|
1,455
|
|
1,779
|
Non cash
stock compensation
|
|
3,288
|
|
6,798
|
Professional fees
|
|
936
|
|
—
|
Costs
for withdrawn bond offering
|
|
—
|
|
1,753
|
Executive bonus
|
|
—
|
|
1,604
|
Strategic consulting and realignment
|
|
—
|
|
450
|
Adjusted
EBITDA
|
$
|
14,361
|
$
|
23,285
|
View original
content:http://www.prnewswire.com/news-releases/basic-energy-services-reports-first-quarter-2019-results-300847680.html
SOURCE Basic Energy Services, Inc.